Today’s young adults are significantly less likely to own a home at a given age than those born only five or ten years earlier. Brits born in the late 1980s had a homeownership rate of 25%. This is compared with:

33% for those born five years earlier (in the early 1980s)

43% for those born ten years earlier (in the late 1970s).

Steep falls in home ownership

Those in the middle-income bracket have experienced the sharpest fall in homeownership. The data showed that in 1995–96, nearly two thirds of those aged 25–34 with incomes in the middle 20% for their age owned their own home. Twenty years later, that figure was just 27%.

Why a decline?

The research suggests that the key reason for the decline is the sharp rise in house prices relative to incomes. Mean house prices were 152% higher in 2015–16 than in 1995–96 after adjusting for inflation.

By contrast, the real net family incomes of those aged 25–34 grew by only 22% over the same twenty years.

i.e. in the last 20 years, average UK house prices have increased by 152% compared to the average family income only growing by 22% over the same 20-year period.

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